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Petr Ježek
Born in Prague in 1965. A graduate of Prague’s University of Economics, Petr Ježek joined his country’s Ministry of Foreign Affairs and served as a diplomat. For some ten years, he held relatively high posts related to the country’s ties with the EU, e.g. heading the Foreign Ministry’s European Integration Department and serving as Deputy State Secretary for European Affairs. He also worked as chief of staff of then Czech Prime Minister Vladimír Špidla. In 2014, Petr Ježek was elected Member of the European Parliament on the ballot of the ANO 2011 party.
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The European Parliament is scheduled to vote on Wednesday on new rules for Europe's trillion euro money market funds industry, aimed at avoiding investor runs in a crisis. Despite difficulties in coming to an agreement in the previous mandate, the new Parliament has been able to reach a common position based on a proposal from ALDE MEP Petr Ježek.
The original Commission proposal included a controversial capital buffer on the Constant Net Asset Value (CNAV) MMF. It was clear that a capital buffer would have killed the CNAV industry. ALDE helped to ensure we have no capital buffer at all, instead proposing a new category of funds, called Low Volatility Net Asset Value (LVNAV) MMFs which would have stricter requirements to mitigate the risks many fear are inherent in the CNAV model.
The LVNAV model would maintain a stable NAV, as current CNAVs do, unless they deviate from par by more than 20 basis points. If the actual NAV of the portfolio deviates below par by more than 20 basis points, the fund must reflect the real value of the portfolio.
This key point of the compromise unites the views of both CNAV and VNAV advocates. It offers a more stable product which remains attractive to current CNAV investors, maintaining the key qualities of the product that makes it attractive - Intraday liquidity, tax treatment and a stable value per share.
Petr Ježek MEP, ALDE shadow rapporteur for this file, commented today:
“I call on all groups to vote through this important piece of legislation today. It is vital to secure a balanced regulation that would enable Money Market Funds to continue to finance the real economy while addressing systemic risk.”
“My principal aim is to make CNAVs safer for investors while addressing possible systemic risks. It is also important to me that we preserve their attractiveness to investors in order to finance the real economy.”
“I am happy that I was able to suggest a compromise proposal which was acceptable to the majority and which will strike a balance between addressing systemic risks and financing the real economy.”
“Of course, in the whole text of the compromise there are aspects I am not entirely happy with, but this will apply to everyone in a regulation as complex and divisive as this.”
“I also call on the Council to move forward with the regulation in order to bring the discussion to the trilogue phase.”